The Nikkei stock index jumped Monday to a 33-year high, as investor sentiment was boosted by a surge in U.S. stocks late last week and robust jobs data for May.
The 225-issue Nikkei Stock Average ended up 693.21 points, or 2.20%, from Friday at 32,217.43, its highest close since July 20, 1990, when Japan was experiencing an asset price bubble.
The broader Topix index finished 37.09 points, or 1.70%, higher at 2,219.79, its highest close since Aug. 1, 1990.
"The market was supported by the gains in the U.S. market on Friday. That helped keep the money flowing into risk assets in Japan," said Shigetoshi Kamada, general manager at the research department at Tachibana Securities.
"Also, Japanese equities are in a more favorable position as investors expect the BOJ would keep its easy monetary policy. So they would go, 'Why not invest in Japan if U.S. stocks gain.'"
The Bank of Japan will hold a two-day policy meeting starting June 15.
Japanese companies' ongoing efforts to boost shareholder returns also supported sentiments, Kamada said.
On Friday, U.S. stocks closed higher after a labor market report showing moderating wage growth in May indicated the Federal Reserve may skip a rate hike in two weeks, while investors welcomed a Washington deal that avoided a catastrophic debt default.
Among individual stocks in Japan, Uniqlo brand owner Fast Retailing rose 2.77% to provide the biggest support to the Nikkei. Technology investor SoftBank Group rose 1.67% and robot maker Fanuc rose 3.04%.
Energy explorers rose 2.25% after as oil prices jumped. Refiners advanced 2.19%.
Chip-related shares, which initially tracked declines in the Philadelphia semiconductor index, reversed course, with chipmaking equipment makers Tokyo Electron and Screen Holdings rising 0.34% and 0.3%.
Tokyo Electric Power Holdings lost 1.91% to become the biggest loser on the Nikkei.